Will Corn’s Glimmer Wane in 2014?

The crop mix of 2014 is already in question. Jerry Gulke provides his take as corn yields come in higher than expected and prices drop.

As harvest continues, the 2014 planting season seems a long ways away. But, the 2014 crop mix is already being analyzed and predicted.

Jerry Gulke, president of the Gulke Group, says Informa Economics updated its acreage expectations for next year. The firm expects 91.7 million acres of corn and 83.9 million acres of soybeans in 2014.

As of its September Crop Production report, USDA estimates the 2013 area harvested for corn to be 89.1 million acres and the soybean area for harvest as 76.4 million acres.

Gulke says he was surprised about the decrease in corn acres. "I’m not sure we’ll get that big of drop," he says. "What else will people plant? You can’t let land sit idle."

Hear Gulke's full audio analysis:

In traditional corn-growing areas, Gulke predicts most farmers will stick to corn, especially since many farmers are seeing yields this year that are coming in much higher than expected. "With 200 bu. corn, even if you did a rotten job in marketing, you’re still looking at $800 per acre," he says. "If you sold anything at all at $5.50, you’re doing even better."

If corn acres are high again next year, following 2013’s high production levels, the price of corn could get pretty ugly next summer, Gulke says. "I suspect the government will have a lot to say about what are price prospects are going forward," he says. "From my standpoint, they don’t look all that great down the road."

In the meantime, prices could still rally to some profitable levels. "Farmers have a lot of holding power right now, since grain bins are empty. We can hope for tight farmer holding," he says.